Support.com 2006 Annual Report Download - page 73

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SUPPORTSOFT, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)
Note 8. Income Taxes (Continued)
The Company’s India based subsidiary was granted a tax holiday related to its research and development activities. The tax
holiday expires in 2009. The tax holiday has an immaterial impact on the current year financial statements.
Cumulative unremitted foreign earnings that are considered to be indefinitely reinvested outside the United States and on which no
U.S. taxes have been provided were approximately $2.6 million at December 31, 2006. If such earnings were distributed, the
Company would not accrue any additional taxes due to the full valuation allowance against its deferred tax assets.
Note 9. Other−Than−Temporary Impairment and Its Application to Certain Investments
The gross unrealized losses related to the Company’s portfolio of available−for−sale securities were primarily due to a decrease in
the fair value of debt securities as result of an increase in interest rates during 2006. The Company has determined that the gross
unrealized losses on its available−for−sale securities as of December 31, 2006 are temporary in nature. The Company has reviewed its
investment portfolio to identify and evaluate investments that have indications of possible impairment. Factors considered in
determining whether a loss is temporary include the magnitude of the decline in market value, the length of time the market value has
been below cost (or adjusted cost), credit quality, and the Company’s ability and intent to hold the securities for a period of time
sufficient to allow for any anticipated recovery in market value.
The following table sets forth the unrealized losses for the Company investments as of December 31, 2006 (in thousands):
In Loss Position
Less Than 12 Months
In Loss Position
More Than 12
Months Total In Loss Position
Description Fair Value Unrealized
Losses Fair
Value Unrealized
Losses Fair Value Unrealized
Losses
Commercial paper $ 35,360 $ (30) $ — $ — $ 35,360 $ (30)
Corporate bonds $ 31,488 $ (23) $ — $ — $ 31,488 $ (23)
Federal agencies $ 1,999 $ (1) $ — $ — $ 1,999 $ (1)
Total $ 68,847 $ (54) $ — $ — $ 68,847 $ (54)
69
Source: SUPPORTSOFT INC, 10−K, March 16, 2007